Bonus plans are incentive programs offered by employers to reward employees for achieving specific performance goals or milestones. These plans can take various forms, such as cash bonuses, stock options, or additional paid time off. The primary aim is to motivate employees to enhance productivity and contribute to the company's success. Typically, bonus plans are tied to individual, team, or company-wide performance metrics. For example, a sales team might receive bonuses based on meeting quarterly sales targets, while executives may have bonuses linked to overall company profitability. This alignment encourages employees to work towards common objectives.